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Buyers of
Samsonite
shares have something in common with the restless throngs crowding the baggage carousels: They may need a lot of patience.

That's not to say Samsonite doesn't pack many appealing investment themes into one Hong Kong-listed stock (ticker: 1910.Hong Kong). Earth's biggest luggage company is a play on the planet's growing middle class, not to mention its desire to travel and hankering for affordable luxury brands. The six biggest luggage companies together hold less than a fifth of the global market; so Samsonite, which has a leading 10% share, has plenty of room to grow.

Still, investors must be prepared for the stock to be stuck in transit. For a start, Samsonite—founded in Denver in 1910—had passed through various hands before its buyout-firm owners listed the company in Hong Kong last year. Its biggest investors—CVC Capital Partners and the
Royal Bank of ScotlandRBS.LN 0.09389671361502347%Royal Bank of Scotland Group PLC ADRU.S.: NYSEUSD10.66
0.010.09389671361502347%
/Date(1438376534765-0500)/
Volume (Delayed 15m)
:
1398358AFTER HOURSUSD10.66
%
Volume (Delayed 15m)
:
56336
P/E Ratio
N/AMarket Cap
61785451357.3698
Dividend Yield
N/ARev. per Employee
442550More quote details and news »RBS.LNinYour ValueYour ChangeShort position
(RBS.United Kingdom)—have been paring their stakes but still own nearly 35% of shares, and they're likely to sell whenever shares climb high enough. Since their debut 15 months ago at 14.50 Hong Kong dollars (about $1.87), shares have traded between HK$9 and HK$17, but most recently were at—you guessed it—HK$14.44.

It doesn't help that all 11 analysts who cover the stock already urge you to buy. Listen to the eager applause when Samsonite recently bagged two acquisitions within 20 days—a $110 million deal to buy the casual bag maker High Sierra, followed by a $35 million pact to buy Hartmann. Analysts gushed about how High Sierra will pad Samsonite's offerings with sports bags, and broaden its core base of business travelers to include outdoor-sports enthusiasts. Universal adoration is nice, but who else is left to win over?

All that's a pity, because Samsonite emerged from a 2009 restructuring leaner and stronger. It got rid of excess baggage by closing weaker stores and paying down debt, and now generates enough cash flow to encourage frequent speculation that it might increase its small dividend. Nearly 80% of revenue comes from wholesale channels or department stores over which it has less direct control. But it is geographically diverse, earning 37% of its sales from Asia, 31% from Europe, 25% from North America, and 7% from South America.

INDONESIA'S ECONOMY IS EXPANDING at a 6.4% pace, among the fastest in Asia; yet stocks are up just 5% this year—trailing even the MSCI Asia ex-Japan index. Clearly, concerns that its economy is overheating are taking a toll.

Some classic symptoms are there: Property prices in Jakarta have doubled in recent years. Credit is booming (even if its ratio to gross domestic product, at about 30%, isn't too high).

Unemployment has shrunk to a 12-year low near 6% while the minimum wage is rising far faster than inflation. The current-account deficit swelled to $10 billion in the first half, roughly 2.2% of GDP, from a $10 billion surplus in 2009—chiefly as imports grew while its commodity-heavy exports suffered from China's waning appetite and weak prices for palm oil, minerals, rubber, and coal. Inflation near 4.5% looks benign. But then inflation provided no advance warning of the U.S. tech and housing bubbles, notes Robert Prior-Wandesforde, director of Asian economics at Credit Suisse, who believes "GDP growth has been pushed above the sustainable rate by a loose monetary stance."

Jakarta has started, for example, to raise down payments for home and vehicle purchases and restrict credit-card applications, but still wants its economy to gallop at a 7% clip heading into the 2014 elections. That requires a tricky balancing act. Stay tuned.

Taking a Tumble

Japan and India eked out gain for August, but Chinese stocks headed to new lows.